Staking ADA (Cardano) is a great way to earn passive income while contributing to the network's security. This guide will review the steps to stake ADA with validators. Staking with validators is one of the best ways to keep your crypto safe and within your own custody compared to staking on crypto exchanges where you may not have full control of your crypto.
What Is ADA Staking?
ADA staking is the process of holding and locking up a number of ADA tokens (the native cryptocurrency of the Cardano network) over a period of time. The goal of staking is to participate in the network Proof-of-Stake consensus mechanism, help secure the network, and earn rewards.
Staking ADA tokens helps the Cardano network's consensus mechanism and help secure the network while earning rewards through additional ADA tokens. These rewards are distributed to validators in proportion to the amount of ADA they have staked and the length of time they have been staking.
A delegator is a token holder who delegates cryptocurrencies to a validator or a staking pool on a Proof-of-Stake (PoS) blockchain.
When you delegate stake to a validator, you specify:
- The ID of the node you're delegating to
- When you want to start/stop delegating stake (must be while the validator is validating)
- How many ADA are you staking
- The address to send any rewards to
Cardano Staking Requirements
- The minimum amount that a validator must stake is 5,5 ADA
- There is no minimum amount of ADA to stake for delegators.
- There is no minimum staking period for validation. However, it's noteworthy that the initial rewards will be distributed after 20 days of holding.
- The maximum staking duration for validation is one year
- The minimum time to stake ADA tokens for delegation is 20 days.
- There is no maximum amount of time to stake ADA tokens for delegation. The longer you stake, the more rewards you generate.
- The minimum delegation fee rate is 2%
The annual percentage rate (APR) that is paid in return for staking ADA to a validator is currently about 8%.
Get the latest Cardano staking APR info with the below link:
Validators | Earn Staking Rewards | Run Cardano Node
ADA holders are incentivized to stake their tokens to secure Cardano. Run an Cardano node, stake your ADA, and earn ADA rewards with minimal hardware requirements.
How To Stake ADA Validator: Step-by-Step Guide
The below guide will provide details on the staking process, delegating staked tokens & how to get node id for ADA holders.
Step 1: ADA wallet
Daedalus and Yoroi are two wallets supporting staking ADA for delegation. You can check them out here and select one that fits your requirements. In addition, you can also stake Cardano on the hardware wallet Ledger Nano.
In this guide, we will choose to stake Cardano through Yoroi. Simply follow these steps:
- Download the Yoroi extension.
- Create wallet.
- Create a username and password.
- Save the seed phase, including 15 words.
Step 2: Buy ADA
Once you're connected to your Yoroi wallet, the next step is to deposit ADA tokens. You will need to withdraw ADA from an exchange. Go to the "Receive" section and copy your wallet address, then paste it into the withdrawal address on the exchange.
You will need to purchase ADA. You can buy ADA on various cryptocurrency exchanges such as Binance, Bitfinex, or Kraken. Use our guide on how to buy ADA tokens on the Binance exchange to get started.
Step 3: Choose Cardano Validator
Select a Validator After purchasing ADA; you will need to choose a validator to delegate your ADA tokens. Validators are responsible for validating transactions on the Cardano network and maintaining the network's security. You can choose a validator from the list of validators available on the Cardano website or use a Cardano wallet like the one provided by Ledger.
What are validators?
What is a blockchain validator node? - Blockchain Guide
A blockchain validator node is a computer that verifies transactions and adds them to the blockchain.
Step 4: Delegate ADA
Specify the staking period and stake amount. Pay attention to the end time of the selected validator. The delegation period cannot be set to end past the end date that the validator has set.
Delegate Your ADA
Once you have chosen a validator, you can delegate your ADA tokens to the validator. This process involves sending your ADA tokens to the validator's staking address. This is done from within your Cardano wallet by selecting the validator and delegating your tokens.
If the validator you delegate tokens to is sufficiently correct and responsive, you will be rewarded when you are done delegating. Delegators are awarded according to the same function as validators. However, the validator that you delegate to keeps a portion of your reward specified by the validator's delegation fee rate.
Wait for Confirmation After delegating your ADA; you will need to wait for the delegation to be confirmed. This can take up to 24 hours, depending on your chosen validator.
Earn Staking Rewards
Once your delegation is confirmed, you will earn staking rewards. The rewards are paid out in ADA and are based on the amount of ADA you have delegated and the length of time you have been staking.
Step 5: Unstaking ADA
Unstaking Your ADA If you decide to unstake your ADA, you will need to go through a similar process to delegating your ADA. You will need to select the validator and then unstake your tokens. It is important to note that there is a cooldown period after unstaking, during which you cannot withdraw your ADA.
Best ADA Validators For Staking
Not sure about choosing the proper validator for staking your tokens? Check out our guide on the top five validators for staking Cardano tokens based on their staking rewards, node uptime, and the amount of ADA tokens available to stake.
Our staking validator guides are released monthly to reflect the changing dynamic nature of validator nodes and to provide the best up-to-date validating node info.
Start staking your Cardano tokens today!